Correlation Between Astra International and Shoprite Holdings
Can any of the company-specific risk be diversified away by investing in both Astra International and Shoprite Holdings at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Astra International and Shoprite Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astra International Tbk and Shoprite Holdings Limited, you can compare the effects of market volatilities on Astra International and Shoprite Holdings and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Astra International with a short position of Shoprite Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astra International and Shoprite Holdings.
Diversification Opportunities for Astra International and Shoprite Holdings
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Astra and Shoprite is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Astra International Tbk and Shoprite Holdings Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shoprite Holdings and Astra International is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Astra International Tbk are associated (or correlated) with Shoprite Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shoprite Holdings has no effect on the direction of Astra International i.e., Astra International and Shoprite Holdings go up and down completely randomly.
Pair Corralation between Astra International and Shoprite Holdings
If you would invest 1,633 in Shoprite Holdings Limited on August 30, 2024 and sell it today you would earn a total of 0.00 from holding Shoprite Holdings Limited or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.35% |
| Values | Daily Returns |
Astra International Tbk vs. Shoprite Holdings Limited
Performance |
| Timeline |
| Astra International Tbk |
| Shoprite Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
Astra International and Shoprite Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astra International and Shoprite Holdings
The main advantage of trading using opposite Astra International and Shoprite Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astra International position performs unexpectedly, Shoprite Holdings can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Shoprite Holdings will offset losses from the drop in Shoprite Holdings' long position.| Astra International vs. Allison Transmission Holdings | Astra International vs. Luminar Technologies | Astra International vs. Lear Corporation | Astra International vs. BorgWarner |
| Shoprite Holdings vs. Boston Omaha Corp | Shoprite Holdings vs. Organic Sales and | Shoprite Holdings vs. Entravision Communications | Shoprite Holdings vs. Marchex |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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